Lawmakers, Dauphin County commissioners frustrated with pace of David Unkovic's decisions

Two area state lawmakers and the Dauphin County commissioners said they are frustrated that Harrisburg Receiver David Unkovic waited until this week to put the city assets he plans to lease and sell on the market.

View full sizeCHRISTINE BAKER, The Patriot-NewsHarrisburg Receiver David Unkovic.

“I believe that should have been one of the first things on the receiver’s agenda,” said Rep. Ron Buxton, D-Harrisburg. “I thought his first plan would be more inclusive as to where he is going with the incinerator debt. I don’t know how much longer we have to wait for a plan to come together.”

Unkovic unveiled his plan for the city Monday. It calls for the sale and lease of assets, increased taxes and fees, re-negotiated union contracts, potentially closing a fire station and streamlined operations in City Hall.

It is a work in progress, however.

On Tuesday, Unkovic posted request-for-qualifications proposal links for the sale of the incinerator and the management of the city’s sewer and water systems. On Friday, he posted an RFQ for firms interested in leasing Harrisburg’s parking system.

Unkovic said he would not know how much city creditors would have to ante up to help pay down the city’s more than $317 million of incinerator debt until he knows the value of the incinerator and parking system and whether it makes sense to have an outside firm mange Harrisburg’s the sewer and water systems. He said he also needs to know exactly how much the city’s annual expenditures exceed its revenues in its budget.

The Commonwealth Court confirmed Unkovic as the city’s receiver on Dec. 2. He was given until Jan. 3 to develop the fiscal plan, but was granted an extension until Feb. 6.

Putting together the RFQs took time, Unkovic said, which he said is why he didn’t post the request for proposals until this week. He said he expects to determine the value of the assets and enter into serious negotiations in April and the asset deals should be completed by June.

When someone is interested in purchasing or leasing an asset, they will sign a confidentiality agreement and send it back to the receiver. He has to make sure the right information they need to know is readily available, he said.

Interested parties have 30 days to respond to the requests.

“The RFQ procedure is complicated. It takes time to develop,” Unkovic said. “If I did send them out right away with all the information not available, it wouldn’t have done much good.”

Sen. Jeffrey Piccola said he shares Buxton’s frustration.

Unkovic should have issued the RFQs within at least 30 days of his confirmation, Piccola said.

Piccola was the prime sponsor of Senate Bill 1151 — the bill that pushed Harrisburg into state receivership.

“I’m a little frustrated on the length of time,” Piccola said. “I wouldn’t even call it a plan. We need some action.”

The Dauphin County commissioners issued a press release shortly after the plan came out saying they too were disappointed by the lack of detail in the plan pertaining to how the incinerator debt would be dealt with.

Interest and other fees continues to mount on the debt to the tune of $1 million per month, said Charles Zwally, special counsel to the commissioners on the city’s debt crisis.

The longer a solution is delayed, the more debt mounts up, Zwally said.

“RFQs should have been done first thing out of the gate,” he said. “The interest rate on this debt is running. That’s why these numbers have become so elevated. There also is the fact that there has been request for proposals done before.”

Debt on the incinerator has increased by more than $20 million since 2009, Zwally said.

Other RFQs have been issued on city assets in the past, but officials called for a renewed lease and sale process under the receiver.

Harrisburg Mayor Linda Thompson is pleased with the plan and the speed at which Unkovic is moving, said Robert Philbin, the mayor’s spokesman.

People who work in the city government and are close to the receiver’s process know he is doing everything he can as quickly as he can, Philbin said.

“The process appears to be moving at a slow pace, but it’s not. Negotiations are moving all over the place,” he said. “He is moving the entire scope of the problem. There has been much more movement since the receiver was named than there was the whole year prior.”

THE PLAN

To see the request for qualification proposals for parties interested in buying, leasing or managing city assets, go to www.portal.state.pa.us and in the search box in the upper right corner type in Harrisburg receiver.

The Commonwealth Court must hold a public hearing on the city receiver’s fiscal recovery plan within 25 days and must confirm or reject it within 55 days.

Receiver David Unkovic has said he expects to know the value of the city’s assets for sale and lease in the plan by April and conclude the transactions in June.

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